Tax Thresholds - Flexible?

BoGoF

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

MrMoff

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

BoGoF

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

MrMoff

BoGoF said:

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

But Surely it does matter for my HR Threshold?

Because if my PTA reduces then surely my HR threshold reduces

As in my example, if my PTA has been reduced to say £9,000 then if you add the amount which is i would get taxed at 20% which is currently set at £37,770 then my HR threshold would start at £46,770 and not the standard £50,270.

RG2015

@MrMoff

I agree that HMRC methodologies and calculations are confusing. Have you registered to view your Personal Tax Account online?

https://www.gov.uk/personal-tax-account

This shows how your personal allowance is calculated and also how the marriage allowance (and other additions and deductions) affect your tax code.

For example it shows that your tax allowance is £12,570 and the marriage allowance is shown as an addition of £1,260, making your total tax free amount £13,830.

This makes your tax code 1383, but your personal tax allowance remains as £12,570.

Note, you will also see this on your paper notice of coding if you have received one.

BoGoF

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

But Surely it does matter for my HR Threshold?

Because if my PTA reduces then surely my HR threshold reduces

As in my example, if my PTA has been reduced to say £9,000 then if you add the amount which is i would get taxed at 20% which is currently set at £37,770 then my HR threshold would start at £46,770 and not the standard £50,270.

Surely not. Did you read what else I said about a tax calculation?

RG2015

@MrMott,

The link below should help with you original question.

https://www.moneysavingexpert.com/banking/tax-rates/

MrMoff

BoGoF said:

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

But Surely it does matter for my HR Threshold?

Because if my PTA reduces then surely my HR threshold reduces

As in my example, if my PTA has been reduced to say £9,000 then if you add the amount which is i would get taxed at 20% which is currently set at £37,770 then my HR threshold would start at £46,770 and not the standard £50,270.

Surely not. Did you read what else I said about a tax calculation?

BoGoF, yes I read your bit about tax calculation,  but sorry but that's not what the HMRC are saying to me.

They are NOT giving me my full Personal Allowance for a previous year, they are reducing it because of an underpayment.

RG2015

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

But Surely it does matter for my HR Threshold?

Because if my PTA reduces then surely my HR threshold reduces

As in my example, if my PTA has been reduced to say £9,000 then if you add the amount which is i would get taxed at 20% which is currently set at £37,770 then my HR threshold would start at £46,770 and not the standard £50,270.

Surely not. Did you read what else I said about a tax calculation?

BoGoF, yes I read your bit about tax calculation,  but sorry but that's not what the HMRC are saying to me.

They are NOT giving me my full Personal Allowance for a previous year, they are reducing it because of an underpayment.

My previous post gave an example of an addition (the marriage allowance) but the principle remains true for a deduction. This will reduce your tax free amount and tax code but not your personal allowance.

Therefore higher rate will always kick in at £50,270 of taxable income.

Dazed_and_C0nfused

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

MrMoff said:

BoGoF said:

When calculating your tax for any given year you will always get the benefit of your full personal allowance and things that were included in your tax code will be shown separately in the calc

They seem to have reduced my PTA because I owed them a certain amount from a previous year

And as I said that's irrelevant for the purposes of HR threshold.

But Surely it does matter for my HR Threshold?

Because if my PTA reduces then surely my HR threshold reduces

As in my example, if my PTA has been reduced to say £9,000 then if you add the amount which is i would get taxed at 20% which is currently set at £37,770 then my HR threshold would start at £46,770 and not the standard £50,270.

Surely not. Did you read what else I said about a tax calculation?

BoGoF, yes I read your bit about tax calculation,  but sorry but that's not what the HMRC are saying to me.

They are NOT giving me my full Personal Allowance for a previous year, they are reducing it because of an underpayment.

You are getting confused between your Personal Allowance, which with the exception of people with very high income, will be either £11,310 or £12,570, and your tax code allowances.

Your Personal Allowance can never be more than £12,570 and owing tax from a previous tax year does not change your Personal Allowance.